Performance Measurrement Essay Example | Topics and Well Written Essays - 3000 words

Performance Measurrement - Essay Example (1997), this trend has led to the creation of new philosophies in performance assessment, such as concurrent engineering/construction, lean production/construction and many others such as JIT, TQM, TPM etc.; and the construction industry has continually saw the adoption of these new principles and techniques to better improve the quality of construction projects The major driving factor behind these new principles is the optimisation of an organisation's performance, internally and externally, to enable it compete favourably well within its market (Kagioglou et al, 2001). This is because performance measurement enables an organisation, construction organisation in this sense, to understand how decision making processes or practices led to success and failures in the past, and how that understanding can drive the organisation towards future improvements (Hatry, 1999). The purpose of this essay, therefore, is to elaborate the set of performance measures that are vital to assess the finances, customer satisfaction and product management in the construction industry, and to identify the right time and application for these performance measurements. ... defines the concept of 'performance measurement', quoting Evangelidisz (1992); he differentiated performance measurement from a similar term, 'performance management. He defined performance management as a closed loop control system which deploys policy and strategy, and obtains feedback from various levels in order to manage the performance of the system; and Performance measurement as the information system which is at the heart of the performance management process and it is of critical importance to the effective and efficient functioning of the performance management system. Thus, one can conclude that performance measurement is the processes of determining how successful organisations or individuals have been in attaining their objectives and strategies (Evangelidisz, 1992 cited in Kagioglou et al., 2001). However, to achieve this BICE (2005) contend that for a set of performance measures to be effective, it must possess the following vital components. These are: Clearly defined, actionable, and measurable goals that cascade from organisational mission to management and program levels; Cascading performance measures that can be used to measure how well mission, management, and program goals are being met; Established baselines from which progress toward the attainment of goals can be measured; Accurate, repeatable, and verifiable data; and Feedback systems to support continuous improvement of an organisation's processes, practices, and results. The importance of using the right performance measures to measure/assess the right 'things' is indisputably evident throughout the construction market today. The results of such appropriate measurement of performance would include attraction of future investment, increase in customer satisfaction, increase in share value